Curb unauthorised expenditure on projects, Railways directs officials

Expressing serious concern over the increasing unauthorized expenditure running into thousands of billions of rupees, Indian Railways has called for urgent measures to strengthen financial discipline in the system.

The Railway Board has directed the General Managers of all District Railways, Production Units and others to initiate effective measures to curb the practice of incurring unapproved expenditure in the execution of projects and subsequently approving the same by the competent authority.

Pointing out that cases of unauthorized expenditure have increased in the recent past, the note stated that the Comptroller and Auditor General of India has highlighted the issue in various audit reports and the issue has now been taken up for review by the Public Accounts Committee (PAC).

The app was not financially viable

“If expenditure is incurred beyond the approved cost and the estimate is subsequently submitted for approval, the review of the estimate by the competent authority is bypassed and the only option left is to approve it as a fait accompli. This practice is against the spirit of financial propriety,” the Railway Board said in a note published on March 27, 2026.

Union Government, changes, cost etc. It imposed various restrictions/limitations on the Ministry of Railways for the approval of estimates on issues. The practice of spending above the approved cost can bypass these restrictions, violate the Ministry of Finance’s guidelines and lead to criticism in audit reports.

The CAG had repeatedly raised the issue of spending beyond the approved cost. The note stated that unapproved spend means spending on unapproved scope/items and this is not a logical decision.

Directing senior officials to put in place a system to ensure that unapproved expenditure does not become the norm, the Railway Board said, “As soon as it becomes clear that the expenditure on a job or project exceeds the amount specified in the detailed estimate or construction estimate, a revised estimate should be prepared and submitted for approval to the competent authority.” he said.

Unauthorized expenditure of ₹ 9,122 crore in 2023-24

The latest CAG report stated that in the financial year 2023-24, the Ministry of Railways incurred unauthorized expenditure of ₹ 9,122.24 crore, covering the 1999 case. In the previous year, a similar expenditure of ₹ 6,483 crore was reported in 1,932 cases.

Similar audit comments were also included in the 2018-19 to 2022-23 CAG reports. “We noted that the Ministry of Railways has not reduced the cases of unauthorized expenditure despite this being mentioned in previous audit reports.”

The railways had spent ₹ 6,19,837.90 crore against the sanctioned grant of ₹ 6,47,031.69 crore, recording a net savings of ₹ 27,193.69 crore in 2022-23. The savings showed that the core activities for which funds were requested through the Grant Requests (operating and generating revenue from the operation of passenger and freight trains), asset creation and value-added were not carried out and the desired benefit from the railways was not achieved.

The CAG report also said that excessive spending beyond the approved grants indicates unauthorized expenditure that should be regulated by Parliament.